Town Sports Reworks Board of Directors, Giardina to Serve as Non-Employee Board Member

The board of directors for Town Sports International Holdings Inc. (TSI), New York, has approved the immediate appointment of five new board members and the resignation of four members. In addition, former TSI CEO Robert Giardina will serve as a member of the board as a non-employee director.

Pamela Kufahl, director of content and engagement | Mar 24, 2015

The board of directors for Town Sports International Holdings Inc. (TSI), New York, has approved the immediate appointment of five new board members and the resignation of four members. In addition, TSI officially terminated former CEO Robert Giardina's employment with the company. Giardina will now serve as a member of the board as a non-employee director.

The changes in the board were made in accordance with two separate agreements by the company that together involve its three largest shareholders: HG Vora Capital Management, PW Partners Atlas Fund III LP and Farallon Capital Management LLC. In connection with the appointments, the board increased its size from seven to eight directors, effective immediately.

Further, TSI has agreed to include Annese, Fish, McEachen, Walsh and Wells, along with incumbent directors Robert J. Giardina, Thomas J. Galligan III, and Bruce C. Bruckmann, in the company's slate of director nominees for the 2015 annual meeting of shareholders.

HG Vora and PW Partners collectively own approximately 26 percent of the company's common stock. In addition to the agreed appointment of McEachen, Walsh and Wells to the board, each of HG Vora and PW Partners agreed to vote its shares for the company's slate of director nominees at the upcoming 2015 annual meeting of shareholders, withdraw their director nominees for consideration at the 2015 annual meeting of shareholders and comply with certain customary standstill provisions.

Farallon Capital Management owns approximately 16 percent of TSI's common stock. At the invitation of TSI, Farallon entered into an agreement with the company pursuant to which, in addition to the agreed appointment of Annese and Fish to the board, Farallon will vote its shares for the company's slate of director nominees at the upcoming 2015 annual meeting of shareholders.

"We are pleased to have reached agreements with our largest shareholders. The board believes these agreements are in the best interest of the company and all of its shareholders," Robert Giardina, executive chairman of the board, said in a company announcement. "We welcome Martin, Jason, Mark, Patrick and Spencer to our board and believe they will enhance our board's collective experience and expertise. On behalf of the board, I'd like to thank Paul, Rice, John and Kevin for their highly valuable service and significant contributions to TSI's success over the years. They have been outstanding directors and have served with distinction."

TSI expects to file proxy materials for its 2015 annual meeting of shareholders in the near future.

Giardina's employment with the company will end on March 27.

The board also announced today that it has approved the redemption of the rights issued pursuant to a rights agreement between the company and Computershare Inc., dated Dec. 31, 2014. The redemption of the rights is effective immediately. The company will pay a redemption price equal to $0.01 per right in cash on April 20, 2015.